Economic Damages Award in FTCA Suit Rejected Due to State No-Fault Law
The district court below had found that, pursuant to the Federal Tort Claims Act, Michigan state law (in this case the Michigan No-Fault Automobile Insurance Act) applies to plaintiff's claim for personal injury benefits. The circuit court affirmed this ruling, rejecting plaintiff's claims that "...Michigan's No-Fault Act should not apply for three reasons: (1) "the Government failed to timely raise [the] No-Fault [statute] as an affirmative defense, and it should not have been permitted to rely on the argument without first obtaining leave to amend its pleadings"; (2) "in order to avoid diverse treatment of federal interests in the several states" and avoid running afoul of federal supremacy; and (3) "the Government must be estopped from relying on the No-Fault statute in this case, because it officially maintained that the statute did not apply (under the Constitution's Supremacy Clause) for more than a year before inexplicably requesting that No-Fault law be applied."
However, a grant of economic damages to plaintiff is reversed where, because the government can be held liable without a finding of fault pursuant to the No-Fault Act (i.e. it is a strict liability law), plaintiff cannot recover economic damages under the FTCA. Lastly, a determination that plaintiff was not entitled to interest and attorneys' fees is affirmed.
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